Although an insurance company is taxed on its BLAGAB on the I-E basis, it may still make use of a BLAGAB trade loss on the grounds that it is sufficiently alike to a normal trade loss to be subject to similar provisions for relief. It is entirely possible for a company to record an I-E profit and a BLAGAB trade loss (or vice versa) in the same accounting period.
BLAGAB trade loss—relief against total profits
Notwithstanding that a BLAGAB trade profit would not be charged to tax under CTA 2009, s 35 because of the application of the charge on the I-E basis, a BLAGAB trade loss may still be relieved against the company's total profits under CTA 2010, s 37 as is the case for any other company1.
In order to keep the shareholders' and policyholders' economic interests in the I-E profit distinct, such a loss may not be relieved against the policyholders' share of the I-E profits2.
BLAGAB trade loss—group relief
As with trade losses arising to non-insurance companies, a BLAGAB
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